Croatia GDP Q3 2016

Croatia: GDP growth speeds up slightly in Q3

November 30, 2016

GDP in Croatia expanded 2.9% in Q3 over the same quarter last year, according to preliminary figures released by the Croatian Bureau of Statistics on 30 November. The reading was slightly up from the 2.8% growth in Q2 and represented the highest reading in more than eight years.

The acceleration in Q3 came on the back of faster growth in private consumption and a positive contribution from the external sector. Private consumption increased 3.4% from the same quarter last year, marking the best result since Q1 2008 and accelerating from Q2’s 3.1% growth. Government consumption grew 2.1% annually, which represented a slight slowdown compared to Q2’s 2.5% growth. Fixed investment lost strength, growing by 2.9% and thereby decelerating from Q2’s 6.5% annual increase. The reading represented the worst result in one year.

On the external side of the economy, exports of goods and services grew 6.3% in Q3, which was an acceleration from the 4.0% expansion recorded in Q2, while imports rose 6.0% (Q2: +7.3% year-on-year). As exports grew more than imports, the external sector’s net contribution to overall economic growth improved in Q3, swinging from minus 1.7 percentage points in Q2 to plus 1.4 percentage points in Q3, marking the best result in one year.

FocusEconomics panelists expect GDP to rise 2.4% in 2016, which is up 0.1 percentage points from last month’s estimate. In 2017, the panel expects economic growth to accelerate to 2.3%, which is also up 0.1 percentage points from last month’s forecast.

The economy performed well in the second quarter of 2017, despite the crisis affecting Croatia’s largest company Agrokor, whose outstanding obligations currently stand close to 15% of the country’s GDP according to the European Bank for Reconstruction and Development.